Melbourne Auction Results – October 26th, 2015
By Peter Sarmas on 25 Oct 2015
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| Melbourne Auction Results 26th October 2015 | |||||
|---|---|---|---|---|---|
|
71% 1358 |
Sold at Auction: | 752 | Auction Volumes: | $978.56m | |
| Passed in: | 394 | Last Weekend: | 1287 | ||
| Sold Before: | 210 | Last Year: | 1682 | ||
| Sold After: | 2 | Houses: | 74% | ||
| Units: | 65% | ||||
A clearance rate of 71 per cent was recorded this weekend compared to 73 per cent last weekend and 71 per cent this weekend last year. There were 1358 auctions reported to the REIV this weekend, with 964 selling and 394 being passed in, 181 of those on a vendor bid.
Next weekend, the REIV is expecting 550 auctions – the highest ever for any Melbourne Cup Day weekend and more than double the number of auctions held last year.
Melbourne Auction Market Being Tested
This week’s news that the remaining 3 of the big four banks were lifting interest rates seems to have unsettled the fragile property market over the weekend.
Based on our observations at open homes and auctions last week and feedback from real estate agents, there appears to be some softening in Melbourne’s property market. Although the clearance rate for the weekend is said to be around the 71% mark I wouldn’t be surprised if we see the final figures closer to the high 60% as more than 200 auction results are yet to be reported. We need to also take into consideration the 1500 plus properties which were auctioned over the weekend, one of the biggest Saturday’s on record so, all in all, not too bad!
A closer look at this week’s auction results show areas like Balwyn, Brighton, Glen Waverley, Mount Waverley and Camberwell seemed to have a higher than normal pass-in rate. Whether that is a direct response to a change in demand from typically “bullish” Chinese buyers or price, only time will tell.
There is no doubt in my mind vendors watching the latest property news will be very nervous and could be considering offers prior to auction.
As the property sales begin to slow under the enormous amount of supply coming onto the market and some uncertainty begins to creep in, there is a sign that rentals are starting to kick into gear and spark interest among consumers again. This is to be expected and is a common occurrence in any property downturn or flattening, as we are beginning to experience. Instead of saving up for a deposit or trying to get a foothold into the property market, perspective home buyers rent instead. Paying a landlord is actually becoming more affordable than paying a mortgage.
This means I would expect tenancy rates and rental returns to start improving and stabilising. There is however the risk still hanging over the whole property market, in particular in the apartment sector, with the large number of apartments due to be completed and tenanted over the next 24 months. We’ve been harping on this for a while now.
Some economists are becoming concerned at the slowing of the current property economy worth an estimated $182 billion, not exactly chump change. Furthermore, when news of the interest rate hikes spread the Aussie dollar fell on speculation the Reserve Bank may seriously consider cutting rates to stimulate the economy rather than allowing it to head towards a possible recession. Pundits however are giving a November “RBA cut” only a 30% chance when they meet in November.
Cameron Kusher from Research House Core Logic/RP Data also brought to my attention last week an interesting point when he said “I’m hearing the housing boom is over…outside of Sydney & Melbourne it was the boom that never was.” From the graph below (Core Logic/RP Data) we can see only two cities since 2008, Melbourne and Sydney, experienced boom like conditions growing by a whopping 68.8% and 76.5% respectively, while all the other cities floundered in comparison. So the “boom” was really in our two biggest cities rather than across Australia.
It also highlights to me the importance of where you should invest in Australia. Anything outside of Melbourne and Sydney would be considered speculative. This makes a lot of sense considering the population growth and economic strengths of these two cities, so keep that in mind next time you are thinking of buying in the next great “hot spot”.
Source: Corelogic RP Data
Next weekend’s Melbourne Cup holiday means that there will be a slight pause in the auction market with less than 500 properties due to go under the hammer.
Street Advocate – Selling a Property
As part of our advocacy role we are very active in selling property on behalf of clients, some of these sales, for whatever reason, turn out be off-market transactions. One such property we sold this week was number 6 Damar Ave, Boronia which we sold for an incredible price..… Read More
TOP 5 HOUSES
1. 2-4 Mangarra Road, Canterbury $5,515,000
2. 11 Gould Street, Brighton $3,900,000
3. 28 Mangarra Road, Canterbury $3,650,000
4. 2 Hyton Crescent, Kew $3,650,000
5. 84 Victoria Road, Hawthorn East $3,490,000
TOP 5 BARGAIN HOUSES
1. 16 Mackellar Drive, Roxburgh Park $291,000
2. 122 Moor Park Drive, Craigieburn $325,000
3. 55 Camms Road, Cranbourne $331,000
4. 9 Brampton Close, Craigieburn $355,000
5. 68 Serenity Way, South Morang $367,500
TOP 5 APARTMENTS
1. E153/85 Rouse Street, Port Melbourne $2,110,000
2. 12/13 Denbigh Road, Armadale $1,705,000
3. 2A Hartington Street, Elsternwick $1,660,000
4. 5/333 Beach Road, Black Rock $1,610,000
5. 1/18 St Georges Crescent, Ashburton $1,605,000
TOP 5 BARGAIN APARTMENTS
1. B29/1-5 Grantham Street, Brunswick West $150,000
2. 4/9 Waratah Avenue, Glen Huntly $263,000
3. 8/396 Murray Road, Preston $266,000
4. 8/2-4 Salmon Street, Mentone $275,000
5. 6/87 Alma Road, St Kilda $275,000
Source: REIV
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If you are thinking of buying, selling or investing and would like a FREE 5 minute chat with Street News Director Peter Sarmas, please contact him on 0418 740 606
or via email at [email protected]
